An extension of Sports Business News, the largest online sports business news service -- featuring the comments and insights of SBN Publisher Howard Bloom

Sunday, November 06, 2011

NBA Armageddon 2011 – same old song and dance

The National Basketball Association’s 2011-12 season is facing its first real deadline – Wednesday, November 9, two days from now. Saturday, meeting for the first time since talks broke down October 28 NBA commissioner David Stern presented the NBA Players Association with a revised offer that could see the players receive 51% of the basketball related income (BRI) in a new collective bargaining agreement. Federal mediator George Cohen was a part of the nine hour negotiation session.

“In the course of the evening the mediator made sort of a 'what if' recommendation to both sides to included suggestions on six subjects.” NBA commissioner David Stern offered in attempting to describe what took place Saturday.

“One was on the BRI split, which was basically a 49/51 band with an upside of the payment to the players of actually 57% above a certain projected income which would be designed to get them to 51.

“He suggested a mini mid level, which was $2.5 million a year for a two year deal for taxpayers.

“He made a recommendation that there should be no sign and trade for taxpayers.

“He made two compromise suggestions, one on the mid level exception, which was we had suggested three years, they suggested four years, and he suggested alternating years of four and three.

“Then on the repeater tax, where we had been at $1.50, they had been at 50 cents, he suggested $1.

“He also suggested a compromise beyond our previous compromise proposal on the cliff, he used to describe the fact that those who are not taxpayers get to share in tax payments at a higher rate than those who are taxpayers.

“We had previously dropped our 100% practice, which was in the old deal, to 50% going to the non taxpayers. But taking that one out, we accepted the first five that I'm describing to you and actually adopted them as our proposal, told the players we would put those in writing so they could be understood and transparent to both sides and that we hoped they would accept it and we would be amenable to making a deal on that basis until Wednesday at the close of business.

“If we're unable to make a deal on those terms by the close of business on Wednesday, we will be making a new proposal which we will also share very soon with the players in writing, which is multifaceted. For purposes of this press conference, suffice it to say it will be a 47% proposal and a flex cap and lots of other issues that you have become familiar with in the course of these negotiations.” Stern said.

While Stern isn’t suggesting Wednesday offer is an ultimatum, given that there is a deadline, the owners are promising things are about to get worse if the offer isn’t accepted by the players by Wednesday; therefore, the offer is in fact an ultimatum.

To no one’s surprise The New York Post reported Sunday the NBAPA have rejected the owners’ offer. The game of chicken the owners and players are playing is about to get much more interesting.

"The players will not be intimidated," attorney Jeffrey Kessler said early Sunday after eight hours of negotiations stretched late into the night. "They want to play, they want a season, but they are not going to sacrifice the future of all NBA players under these types of threats of intimidation. It's not happening on Derek Fisher's watch; it's not happening on Billy Hunter's watch; it's not happening on the watch of this executive committee."

Kessler who missed last week’s three days of labor talks is a hardliner, on the players’ side, a lawyer who has worked with the NFLPA, NHLPA and the NBAPA before; each time pushing the players toward sticking to their guns.

Kessler believes the NBA offer is a ‘sham’, in reality it offers the players close to 50.2%, nowhere near the 51% Stern is suggesting. Still even if Kessler is correct 50.2% is a lot more than the 47% Stern is insisting will be on the table in two days.

"Today was another sad day for our fans, for arena workers, our parking lot attendants, our vendors. Very frustrating, sad day," union president Derek Fisher added. "We, for sure, unequivocally, made good faith efforts to try to get this deal done tonight. And we're at a loss for why we could not close it out."

There have been many reports suggesting NBA owners who met Saturday morning before Stern and his group met with Hunter, Fisher, Kessler and the players’ representatives have more then enough support from hardline NBA owners, reportedly led by NBA legend Michael Jordan now the owner of the Charlotte Bobcats, to offer the players less than a 50/50 BRI split. Stern did his best to sell anyone listening that at least today he has the support for a 50/50 BRI split.

“We had a, in the language of diplomacy, frank and open dialogue at our Board of Governors meeting. It was a good meeting. When you have 30 people, you get different points of view, but they were I believe very supportive of the committee and its efforts to bring back a deal that would be presented at the same time as a revenue sharing proposal.

“We spent the morning, well into the afternoon, discussing the state of the Collective Bargaining and the state of the revenue sharing proposal.” Stern said.

Kessler, who missed last weeks’ three days that feel apart on October 28, is emerging as a key member of the NBAPA negotiation team. That isn’t working out very well for the NBA.

"I think it's fair to say that speaking on behalf of the union, Mr. Kessler rejected the mediators' recommendations and our proposal," Stern said. "But hope springs eternal, and we would love to see the union accept the proposal that is now on the table." Kessler is currently the Global Litigation Chair at the international law firm Dewey & LeBoeuf where he is also the co-chair of the Sports Litigation Practice Group and serves on the firm's Executive and Leadership Committees. His major clients include the National Football League Players Association and the National Basketball Players Association.

Kessler became known as one of the most prominent sports lawyers in the country as he became regularly engaged in high-profile sports litigation. He litigated some of the most famous sports-antitrust cases in history while at Weil Gotshal & Manges including McNeil v. the NFL, the landmark antitrust jury trial which led to the establishment of free agency in the National Football League (NFL).

He also handled numerous other sports law cases for such clients as the National Football League Players’ Association, the National Basketball Players’ Association, the Arena Football League Players’ Association, the National Hockey League Players’ Association, the Major League Baseball Players’ Association, the NFL Coaches’ Association, Players, Inc., the Women's Tennis Benefit Association and Adidas.

Kessler represented various classes of NBA, NFL, AFL and MLS players, and several other professional leagues, the now defunct North American Soccer League and United States Football League, as well as the Cities of San Diego and Oakland, and Alameda County, in various sports law disputes. He also successfully represented Latrell Sprewell in his controversial suspension arbitration. Kessler isn’t a heavyweight sports labor negotiator, he is the best at what he does – his track record time and time proves why Jeffrey Kessler is one of the most influential leaders in the sports industry.

The real question isn’t Kessler or his ability but the resolve of the NBAPA. SI.com reported Saturday that Los Angeles Lakers superstar Kobe Bryant reportedly believes the two sides should agree on a 50/50 BRI split. Bryant, one of the NBA’s highest profile players, isn’t helping Kessler, Hunter or Fisher if he’s suggesting let’s agree on a 50/50 BRI split and get back to work.

There have been many media reports in the last few days that suggest the players are days away from decertifying their union. ESPN’s True Hoop is reporting that Boston Celtics star Paul Pierce is circulating a petition in an attempt to collect the necessary 130 signatures to force a decertification vote. If that vote were to take place and pass, the union would cease to exist, the owners would then attempt to force whatever CBA they wanted on the players, subject to the approval of the National Labor Relations Board. While the two sides would have up to 45 days to negotiate a settlement, the risk that both sides are taking is allowing the court system to dictate the outcome.

“Decertification is risky and messy [for the players],” says one backer, “but it’s the only thing that scares the owners. Because then they lose total control.”

The biggest challenge the NBAPA continues to face is their image of unity and how terrible the NBAPA is at getting out whatever message they want to hear on behalf of their group. Consider what has taken place in the last seven days that can be directly attributed to the NBAPA and their leadership, or lack thereof:

• Reports have NBAPA President Derek Fisher and NBAPA executive director Billy Hunter on opposite sides of what needs to be done.

• Hunter reportedly made a unilateral decision on October 28 to end the talks with the players after the league told the players the league wasn’t prepared to increase their BRI offer above a 50/50 split.

• First Hunter, then Fisher and now Kessler are talking on behalf of the players. Only Stern and occasionally does Adam Silver speak on behalf of the owners. The only question in regard to the players is who will next speak on their behalf; we know who will deliver the message on behalf of the owners.

• Twitter has become one of the single biggest negative forces the players are facing. Hundreds of NBA players are tweeting their opinion. While every NBA player is entitled to their own opinion, Miami Heat owner Mickey Arison learned a $500,000 lesson when he tweeted his opinion. Stern has control; Hunter and company are running a “Lord of the Fly” operation.

• One of the NBA’s biggest stars Kobe Bryant wants his union to give in to the owners and accept a 50/50 BRI split before its too late. It’s too late when one of the game’s marquee talents is siding with management.

What remains shocking is NBA players won’t miss their first paycheck until November 15 – 8 days from now. If the resolve of the players appears to be crumbling now what’s going to be happening at two weeks or month’s time?

National Hockey League players walked away from an entire season before they gave in, and lost, to NHL owners. We will never really know how far NFL players were prepared to have gone had NFL owners had really pushed the players. With $9 billion on the line for NFL owners there was too much money on the table for a deal to not get done.

The issue with NBA players remains today what it was two weeks ago, what it was three months ago and what it will be if they’re not back at work very soon. The 29 NBA owners can afford to miss an entire NBA season. Needless to say they don’t want to see that take place but if push comes to shove NBA owners will still walk away billionaires if the 2011-12 NBA season isn’t played. The average NBA player earns $5.1 million a year and the average NBA career is a little over four. The average NBA player can’t afford to miss the entire 2011-12 season. The sooner NBA players accept their fate, realize they can’t win and that the owners can and will wait them out, the sooner the two sides will reach an agreement, the sooner the NBA will return to action on the court and not in a boardroom. The NBAPA has become an embarrassment to itself and to the union movement.

About Me

The evolution of Howard Bloom’s career took a dramatic change in the spring of 1997, when Howard began publishing SportsBusinessNews.com. In its fifteen years, SBN has evolved into the largest and one of the most influential sports industry publications.